CL unable to break through key resistance level
Colgate-Palmolive Company (CL) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CL finished Wednesday at 76.91 edging lower $0.03 (-0.04%) on low volume, but still slightly outperforming the S&P 500 (-0.46%). Trading $0.52 higher after the open, Colgate-Palmolive was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Tuesday's low at 76.92, the stock confirmed its breakout through the previous session low after trading up to $0.05 below it intraday.
Daily Candlestick Chart (CL as at Sep 16, 2020):
Wednesday's trading range has been $0.88 (1.14%), that's slightly below the last trading month's daily average range of $1.19. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CL.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. Additionally, one bullish candlestick pattern matches today's price action, the Last Engulfing Bottom Pattern. The last time a Last Engulfing Bottom Pattern showed up on June 26th, CL gained 1.27% on the following trading day.
Unable to break through the key technical resistance level at 77.55 (R1), the market closed below it after spiking up to 77.75 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. The share found buyers again today around 76.87 for the third trading day in a row after having found demand at 76.92 in the prior session and at 76.95 two days ago.
While CL is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could accelerate should prices move below the nearby swing low at 76.26 where further sell stops might get triggered.
Among the 13 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Bottom Pattern" stand out. Its common bullish interpretation has been confirmed for Colgate-Palmolive. Out of 48 times, CL closed higher 56.25% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 66.67% with an average market move of 1.14%.